Morgan Stanley plans callable contingent income securities on S&P 500

By Wendy Van Sickle

Columbus, Ohio, Nov. 4 – Morgan Stanley plans to price callable contingent income securities due Nov. 18, 2025 linked to the S&P 500 index, according to a 424B2 filed with the Securities and Exchange Commission.

Each quarter, the notes will pay a coupon at the rate of 7.25% per year if the index closes at or above the coupon barrier level, 75% of the initial index level, on the observation date for that quarter.

If the index finishes at or above the downside threshold level, 60% of its initial level, the payout at maturity will be par plus the final coupon, if applicable. If the index finishes below the downside threshold level, investors will be fully exposed to the index’s decline.

Beginning Nov. 18, 2016, the notes will be callable, in whole but not in part, at par on any quarterly redemption date.

Morgan Stanley & Co. LLC is the agent.

The notes will price Nov. 13 and settle Nov. 18.

The Cusip number is 61761JQ44.

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